2001 Report to Congress on the Implementation of the Support for Overseas Cooperative Development Act

From www.ocdc.coop:

As required by the Support for Overseas Cooperative Development Act, 2000, USAID reviewed past and present cooperative development activities in order to:

(1) assess lessons learned;

(2) develop guidelines for future support for cooperative development; and

(3) determine how best the Agency can position itself to implement these guidelines.

The review was done in partnership with the Overseas Cooperative Development Council and its member cooperative development organizations (CDOs).

History and successes

USAID’s partnership with CDOs began in the early 1960s. During the last thirty years, eight CDOs have managed $1.12 billion in USAID-financed activities. This includes more than $105 million in Cooperative Development Program grants designed to accelerate and expand the CDO’s reach and impact. At present CDOs manage a $160 million project portfolio in more than 60 countries.  USAID-supported cooperative development has achieved notable successes. The World Council of Credit Unions has reached more than 20 million credit union members in developing and transitional economies, members who have saved $27 billion. NCBA’s work with Indonesian cooperatives has helped them earn more than $600 million from exports of furniture and commodities. ACDI-VOCA has helped 166,000 Ethiopian and Malawian farmers save $4 million in input costs and earn more than $11 million on cash crops. More than 20 million rural Bangladeshis are served by rural electric cooperatives promoted and supported by NRECA. In only a decade NTCA’s work in Poland resulted in 40,000 connections provided by six self-reliant rural telephone services. Over the same period, CHF has helped house three million families in nearly 100 countries.

Lessons Learned:

Several important lessons have been learned from USAID’s more than forty years of partnership with CDOs. Among these are:

• The link between cooperative success and cooperative principles, most especially those of member centrality and control;
• Cooperative autonomy is associated with success; cooperative subservience to external interests is associated with failure;
• Cooperatives function best when law and regulation provide a level playing field for competition with other enterprises;
• Governance structures must be strong, transparent and honest;
• Cooperatives must perform: to survive, endure and thrive they must be important to their members, their community, and sector of the economy;
• Support to cooperative development that creates dependency undermines the mutual self-reliance that is central to cooperation;
• Cooperatives must develop professional management in order to adapt, innovate, and take rational risks to satisfy the expectations of their owners; cooperatives succeed when they consistently deliver value to their owners; and
• Institution building takes time, normally more time than project cycles allow.